Best mortgage deals for first-time buyers

Published by Adam Williams on 29 July 2015.
Last updated on 14 November 2017

Buying your first property can be a daunting task. The sheer variety of mortgage products means it can be hard to compare your options to find the best offers. 

Each week, we review the market to find the best variable and fixed rate deals currently available for high loan to value (LTV) borrowers - these are our Moneywise Best Buys.

Remember that once any fixed rate period ends the mortgage will revert to a standard variable rate (SVR), so make a note in your diary and switch to a cheaper deal when that happens.

Our example first-time buyer has a 10% deposit and is looking to buy a £200,000 property over 25 years. For ease of comparison, we’re assuming any bank or building society fees are paid up front. Otherwise interest will be charged on the fees, which will add hundreds of pounds to the overall cost of your loan.

Best fixed rate mortgage deals

Yorkshire Building Society, up to 90% LTV, 1.89%
Fixed until 29 February 2020, then reverts to SVR (currently 4.99%)

This deal from Yorkshire BS comes with £1,200 fees and £250 cashback. Repayments are £753 a month, which is £9,515 a year over the first two years.

West Bromwich Building Society, up to 90% LTV, 2.69%
Fixed until 31 December 2019, then reverts to SVR (currently 3.99%)

This deal from the West Brom comes with no fees and £1,000 cashback. Repayments are £825 a month, which is £9,516 a year over the first two years.

Longer fixed rate mortgages

Digital Mortgages by Atom Bank, up to 90% LTV, 2.45%
Fixed until 31 January 2023, then reverts to SVR (currently 3.75%)

For those looking to fix for a longer period then Atom Bank offers a 2.45% rate, fixed for five years. This mortgage costs £803 a month - £9,860 per year over the fixed period - and comes with £1,120 in fees.

Coventry Building Society, up to 90% LTV, 3.39%
Fixed until 31 December 2027, then reverts to SVR (currently 4.49%)

This deal from Coventry Building Society offers a 3.39% rate, fixed for ten years. This mortgage costs £891 a month - £10,756 per year over the fixed period - with £499 in fees after cashback.

Variable rate mortgages

Hanley Economic Building Society, up to 90% LTV, 1.94%
3.25% discount for five years, then reverts to SVR (currently 5.19%)

For buyers who are willing to risk a further rate rise (or gamble on a rate cut), Hanley Economic Building Society offers a 3.25% discount on its SVR. There are £250 fees and £250 cashback, meaning the annual cost is £9,139.

Best mortgages for larger deposits

Platform, up to 75% LTV, 1.69%
Fixed until 29 February 2020, then reverts to SVR (currently 4.74%)

There are no fees to pay and £250 cashback on offer. Monthly repayments are £613 so the effective annual cost is £7,310.

The AA, up to 75% LTV, 1.34%
Fixed until 31 December 2019, then reverts to SVR (currently 4.49%)

There are £495 fees to pay but and £250 cashback on offer. Monthly repayments are £589 so the effective annual cost is £7,322.

Interest-only mortgage deals

If you’re looking for interest-only options, remember the rules are now a lot stricter and you’ll need to show a well-thought out plan for repaying the capital at the end of the mortgage. Monthly repayments are much lower than with capital repayment, but you'll pay more interest on an interest-only mortgage in the long run. 

Not every provider will lend on an interest-only basis, so if you’re looking for one it’s best to speak to a mortgage broker. Our mortgage tool can help you get a feel for the rates on offer.

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Call free on 0800 073 1936 or see mortgage best buys online.

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